Over the past five years, the Marinas industry has been sailing along with increased revenue growth and rising profit.
For this reason, industry research firm IBISWorld has updated a report on the Marinas industry in its growing industry report collection. Over the past five years, the Marinas industry has been sailing along with increased revenue growth and rising profit.
Marinas provide storage for small, recreational boats through the rental of slips and moorings, and often provide additional services such as maintenance, sport and recreation equipment rental, and food and beverage sales. According to IBISWorld Industry Analyst Melissa Imbruglia, “As shown by increased boat building activity, consumers have been feeling more financially sound and capable of spending on nonessential activities such as boating and water sports over the five years to 2015.” Rising recreational spending and declining fuel prices have also created positive conditions for the Marinas industry, which is estimated to rise at an average annual rate of 2.3% over the five-year period.
Total industry revenue is expected to reach $4.3 billion, growing 2.4% in 2015 alone. While the postrecession climate has been difficult for many marina operators, consumer conditions have raised demand for boat storage as the number of boat owners has increased as a result of rising disposable income and the growing number of households earning over $100,000. Although not all boat owners are affluent, consumers with more available funds for large expenses are more likely to have a recreational boat and purchase the services provided by marinas.” Marinas profit most from customers that spend on nonessentials in addition to storage, such as cleaning, and from passing tourists that rent recreational equipment and use the marina’s amenities,” says Imbruglia.
Profit margins for marinas are estimated at 13.4% in 2015, and are forecast to rise in the coming years. The Marinas industry has a very low level of concentration. IBISWorld estimates that the three largest firms operating in this industry account for less than 5.0% of industry revenue. There are a significant number of small players in this industry, adding to the industry’s fragmented nature. About 80.8% of establishments in the Marinas industry employ less than 10 people.
The low level of concentration within the industry is not expected to change significantly over the next five years. Due to the small size of most companies and the limited amount of real-estate for expansion, IBISWorld expects some mergers and consolidations in the future from larger players. Additionally, the industry does not include services from government establishments who use the coastline for port authority water transportation, further reducing concentration. While many operators left the industry following 2009, businesses that have stuck it out have experienced considerable revenue growth and will likely expand operations with their increased earnings.
Marinas will seek to raise revenue through the addition of full-service restaurants and bars, equipment rental services and other merchandise sales. Boat repair and maintenance will continue to lift sales as the number of boat owners increases. Consumer disposable income and recreational expenditure are expected to rise over the five years to 2020.
IBISWorld forecasts revenue to grow at an average annual rate of 2.5% to reach $4.9 billion in the next five years, including a 2.8% rise in 2016 alone. IBISWorld industry Report Key Topics Marinas provide docking and storage for pleasure craft owners. Marinas may also sell fuel and marine supplies and provide services such as repairing or renting boats. Many operators in this industry offer sailing instruction in addition to recreational boat rental. Marinas do not handle large passenger ships or cargo from freighters.
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About IBISWorld Inc: Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide.
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